Secretary Locke Addresses Chinese Foreign Direct Investment in the United States and the Current State of U.S.-China Commercial Relations

This morning, Secretary Locke addressed the Asia Society
Center on U.S.-China Relations and the
Woodrow Wilson
Center’s Kissinger Institute on China. The groups today released a new study that shows Chinese foreign direct investment in America
doubling in each of the last two years. Chinese investors now have investments
in at least 35 of our 50 states, across dozens of industries, employing
thousands of Americans. Locke welcomed this
news, but also noted progress the U.S. needs to see from Beijing
to improve the business environment for American companies trying to
invest or expand into China.

He said,
“When it comes to market access problems for foreign companies, the issues may
be different, but the fundamental problem often boils down to the distance
between the promises of China’s
government and action.”

Locke said China's often
opaque government regulations and poor enforcement of patents and other
intellectual property rights indirectly discouraged foreign investment.
"But China
has also pursued policies that make investment by foreign companies especially
challenging," he said.

Those include "indigenous
innovation policies that shut foreign companies entirely out of industries or
make unacceptable technology transfer provisions a condition of operating in China,"
Locke said. He said Chinese officials pledged at past high-level forums in 2009
and 2010 to lift foreign investment prohibitions on many industries in which U.S. firms are
world leaders. But China's
recently revised "Foreign Investment Catalog falls far short of that
promise," Locke said.

Secretary Locke finished
his remarks by underlining how important the U.S.-China relationship is to both countries and
the world.

In front of us is the opportunity
for China and the United States
to lead the world economy in the early 21st century, to create a new foundation
for sustainable growth for years to come. We can’t tell exactly what that
future will look like. But we can be certain that it will be a better
future if the Chinese and American governments pursue cooperation over
confrontation in the economic sphere. Cooperation that will put millions of our
people to work. Cooperation that will develop technologies to solve the most
pressing environmental, economic, and social challenges facing the world today.

This is the great opportunity
before China and the United States.
We just have to seize it.